A perfectly competitive firm operates in the short-run with labor as its only variable factor. Its production function is:
Q = -L3 + 10L2 + 88L
where Q is output per week measured in tons and L is the number of workers employed. The weekly wage is $324 and the product sells for $3.24 per ton.
(c) How many workers should the firm employ to maximize profits?
(d) Calculate the firm’s point elasticity of demand for labor at the equilibrium in (c) above.